Richland penny program has $154M in rising costs. Can all projects still get done?

The Richland County penny transportation tax is paying to widen Bluff Road in south Columbia.
The Richland County penny transportation tax is paying to widen Bluff Road in south Columbia. tdominick@thestate.com

Richland County’s roads program is on track to spend $154 million more than anticipated, raising questions among some county officials about whether all the projects will be finished.

Numbers from monthly progress reports show the penny tax-funded program is likely to exceed the dollar amount approved by voters in a 2012 referendum, according to the latest projections prepared by the consortium of private companies that run the penny program and posted online by the county. The cost increase puts the program roughly 15% above what the 22-year penny tax is expected to raise.

The growth in costs increases the possibility that some penny projects still on the waiting list may run out of money, forcing Richland County to find other means of funding them or dropping the projects all together.

When asked about the cost increases by The State, Richland County Council Chairman Paul Livingston said the growth in costs means officials will have to re-evaluate how to complete the project list within the amount approved by voters.

“Unless you cut something or some (projects) come in under cost, you will have to make some decisions based on cost,” Livingston said.

It’s unclear how cost increases could affect specific, unfinished penny projects. Richland County Council will hold a work session June 18 to discuss the future of the penny program as the county prepares to bring management of the program in-house.

A management contract with the private Program Development Team or PDT — the consortium that runs the program — expires in November, and the council voted earlier this year to take over management of the program in hopes of saving $4 million a year.

Some projections are blowing past what penny projects were originally expected to cost. The widening of North Main Street was approved at $30 million in 2012, but since construction got underway in 2017, the expected price tag has doubled to more than $63 million by the first quarter of 2019, progress reports show.

Likewise, the widening of Atlas Road, a connector between Garners Ferry and Shop Road that includes Bible Way Church and is scheduled to begin construction this year, has ballooned from $17.6 million in 2012 to a projected $43.9 million today.

Livingston told The State the numbers don’t mean that money allocated by the referendum has been misspent. Increases in a project’s cost estimates just reflect the fact construction costs have gotten more expensive since the referendum was passed more than six years ago.

“There was an assumption that North Main Street, for example, would cost a certain amount, and now it costs more,” said Livingston, the council’s longest-serving member who was initially elected in 1990.

Officials have worried about the project’s long-time viability for a while. In 2017, then-Richland County Administrator Gerald Seals was so worried about the state of the $1 billion program he outlined his concerns in a 29-page memo for Richland County Council that delineated how the program was on course to run $104 million over 2012 estimates.

Seals warned in the Nov. 14, 2017, memo to council that “Substantial cost overruns appear to have become chronic, thereby potentially jeopardizing compliance with the approved referendum.”

Seals wrote that the average project would be $1,702,968 over budget. He based his calculations on initial estimates for each project, which were listed in the county ordinance that enacted the sales tax increase in 2012.

“As the program now stands, for every $7 budgeted there is an average net overrun of $1,” Seals wrote.

The memo cited the large cost increases associated with widening projects like Atlas and North Main. But it also highlights smaller overages such as $9.4 million for intersection improvements at Clemson Road and Sparkleberry Lane, The State reported at the time.

Those estimates have only grown in the past year and a half. The Clemson/Sparkleberry intersection is now $12.4 million over the referendum amount, progress reports show.

When contacted for this story, Seals declined to comment on how the program had been run since he left county government in April 2018, but said he stands by his analysis at the time. Calls from The State to a representative of the PDT were not returned.

Joe Walker, a member of the council’s transportation committee, is optimistic the move can save the county some money from the change, but says more needs to be done.

“I think we’ll be best-served by bringing in an outside financial expert,” said Walker, a first-term council elected last November.

But even if the change in management gives the county more control over the penny tax projects, “The cost is not going to be any cheaper,” Livingston said. “Payments are still going up.”

Walker said he would be against going back to the voters for another referendum on funding the remaining projects.

“This is where we are today,” he said. “We have to say, here’s what’s left, let’s see what we can do. And which do we not do?”

ProjectReferendum amount2019 Q1 EstimateOverrun
North Main Street$30,000,000$63,180,851.74$33,180,851.74
Atlas Road$17,600,000$43,963,521.26$26,363,521.26
Shop Road$33,100,000$51,814,907.71$18,714,907.71
Broad River Road$29,000,000$46,021,509.76$17,021,509.76
Clemson Road/Sparkleberry Lane$5,100,000$17,345,475.50$12,245,475.50
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Bristow Marchant is currently split between covering Richland County and the 2020 presidential race. He has more than 10 years’ experience covering South Carolina. He won the S.C. Press Association’s 2015 award for Best Series on a toxic Chester County landfill fire, and was part of The State’s award-winning 2016 election coverage.